NOTES ON THE WAR.

Lyttelton Times, Volume CXVII, Issue 17096, 19 February 1916, Page 8

NOTES ON THE WAR.

Recent London files contain quotations from the German newspapers which throw a. good deal of light on. the Rumanian question. The news that reaches this Dominion concerning Rumanian politics comes through Allied channels and is liable to he prejudiced, so that- it. is scarcely possible even to guess what. Rumania proposes to do in the war. But the economic position of the country is more easily ascertained. She has grain to sell, and unless it is bought by the Allies, who either do not require it—as in the case of Russia—or arc unable to take delivery, it must be exported to the Central Powers. When Britain bought a huge quantity of wheat for delivery after the wa.r it wa s obviously to prevent the grain from falling into the hands of the Austrians and Germans. But for all that, Germany lias managed to acquire a considerable quantity of Rumanian cereals, and the enemy newspapers give the terms of the contract.

It- appears that on December 23 an agreement was signed regulating the export from Rumania of cereals which were bought by Germany and Austria during the summer and also providing for the purchase by Germany of 500,000 tons of the new season's grain. The transport of the two lots is to proceed simultaneously, at the rate of two tons of the new grain for one ton of the former season's. The Rumanian Government guarantees the safe transport

bv rail and river of both purchases. Of tho new purchase of half a million tons 40 per cent is wheat and rye, !•:> per cent barley, 20 per cent maize, 10 p p r cent oats, and 15 per cent, beans and peas. Payment of the new consignments will be made cither when the goods cross the frontier or when they leave Rumanian ports on the Danube. Delivery must be completed by the end of April, 1916. A clause in the contract, provides for further purchases should these, he found necessary.

It is a little curious to find the German newspapers criticising the prices paid for the grain, their belief being that outside the Central Powers and Bulgaria Rumania could not possibly find customers. For instance, the “ Kolnische Zeitung” says it views tho business with rather mixed feelings. It is, of course, pleased to know that Rumania sees at last that the placing of hindrances in the way of the export of grain can only damage herself. Germany and Austria-llungary can, of course, use Rumanian grain with advantage, as it, is a desirable addition to the stocks which have been happily found to' bo sufficient. But. the Rhenish journal fears that the desire to he. pleasant to Rumania lias influenced Germany and Austria-Hungary, and it is probable that had the Central Empires waited longer they might have obtained more favourable conditions of purchase. It. is clear, it. says, that Rumania needs to export. Mho else is in a position to buy Rumania's grain if the Central Powers declined to do so? The journal concludes that Rumania must he grateful to Germany and Austria-Hungary that these Powers have not utilised Rumania's necessities in an unscrupulous fashion to their own advantage.

The ‘‘ Hamburger Fremdcnblatt, ” sees in the new arrangement the instantaneous effect of the. German advance to the south-east. There is no reason why Rumania and Bulgaria, should not now be able to pour their agricultural products into Central Europe to such an extent that the scarcity in bread, milk and meat should be changed to abundance. Bulgaria has already sent. 20,000 tons of maize to Germany. It is not much when one remembers that Germany needs one million tons annually, but it is a. beginning. In discussing the effect, of the new importations on prices the Hamburg journal is vague, but fears that the middlemen and others who will handle the grain on its way will absorb a great deal of money and compel dealers in Austria and Germany to insist on maximum prices.

There may appear to he no special reason why the fall of Erzerum should affect the credit of Germany abroad, seeing that Turkey is the country immediately affected, but international finance is a very delicate organism. The German mark in Amsterdam was already 26 per cent below par at tho end of December, and', although the Germans could have eased' the. situation in the Dutch capital by sending gold from Berlin, they hesitated to do so because they wore anxious that the metal should not roach Britain. For a similar reason, presumably, there is little gold movement from Britain to Holland, and the exchange is against Britain, also, though not so seriously as it is against Germany. ’I lie exchange rate depends to a largo extent on the immediate course of trade, ana it is therefore not invariably a reliable indication of the. general credit of a country abroad. There is bound to be a great deal of German paper in Holland, in payment for goods purchased, ami the longer Germany declines to pay in gold the lower the mark vill fall when estimated' in Dutch money.

It. is interesting to observe how the credit of enemy countries has been affected by the war. One might quote the example, of Turkey, which in 1909 issued in Loudon a 4 per cent loan at S 9. To-day that loan is quoted at 34. but. as interest is not paid in London, the figure is not a fair index to the Ottoman credit abroad. One is on sounder ground in quoting the prices of enemy war loans in America. Early in December the German o pci cent war loan, redeemable in 1921, was offered at 202d0l 50 cents per 1000 marks. The value the mark before the war was 23J cents, so that 1000 marks should be worth 237.50 in dollars. German Imperial 4 per dent bonds have boon selling in New’ York at 18-5.50 per 1000 marks. As for Austro-Hungarian credit, the approximate value, of 1000 kronen is 203 dollars. The Third Austrian War Loan at- 5} per cent has been offered at--141.75 and tile Third Hungarian 6 per emit loan at 1,46.75. One American correspondent states that at, current prices the Austrian and Hungarian loans would return over 81 per cent, and he adds that even at- that, attractive figure they are not wlia.t, would be teiintd popular as investments.

The development of the hand-bomb and the grenade in the. course of the trench war in France lias been most remarkable. ' The early bombs were crude affairs, many of them mere makeshifts. The one most commonly employed now is a. beautiful globe, about the size of a cricket hall, which carries enough explosive to blow 7 up half a. dozen Germans,” to quote a correspondent. As a matter of fact, it, does its damage chiefly hv menus of the fragments of the- metal envelope. About 30,000 of these missiles are said to have been thrown during tile British attack on the Holienzollorn redoubt, and as each bomb costs about, os the attack was fairly expensive. As Sir Douglas Haig lately reported that a fierce grenade struggle was being waged on the sector south of Ypres. it may perhaps be said that the British arc still “throwing money away. They are throwing it at the Germans with good effect, however.